Arbitration Agreements

The Preservation of Civil Rights Protections Act of 2001 would provide that all employment arbitration agreements are unenforceable unless the employer and employee voluntarily consent to arbitrate the dispute after it has arisen.

The bill would provide that all employment arbitrationagreements are unenforceable unless the employer and employee voluntarily consentto arbitrate the dispute after it has arisen.

Status The PCRPA was introduced on June 21, 2001 by Rep. Kucinich(D-OH) and referred to the Judiciary Committee and the Education and WorkforceCommittee. Thirty-seven other representatives have cosponsored the bill.

Impact The PCRPA is intended to overturn a recent 5-4 decisionby the U.S. Supreme Court, Circuit City Stores Inc. v. Adams, which held thatan agreement to arbitrate employment disputes was enforceable under the FAA.Prior to the decision, U.S. federal courts were split on the issue. The CircuitCity decision offers employers the opportunity to limit the time, money, andexposure typically associated with many employment disputes by funneling themthrough the same arbitration process.

Opponents of what is often called "mandatory arbitration"feel that employee rights to dispute workplace actions will be severely impairedif they cannot pursue their civil rights in courts or agencies. By requiringthat employees voluntarily consent to arbitration of a dispute after it arises,the PCRPA would hedge against the perceived loss of rights associated with theCircuit City decision.